WIFIA Amendments Slash Project Costs to $1M, Offer 55-Year Loans for Long-Term Water Infrastructure

The Water Infrastructure Finance and Innovation Act (WIFIA) is the federal government’s program for financing big water projects, essentially offering low-interest, long-term loans. This new set of amendments, the Water Infrastructure Finance and Innovation Act Amendments of 2025, is focused on making those loans much more accessible to smaller communities and modernizing how projects get built.

The Small Town Water Upgrade Program

If you live in a small town, this bill is a big deal for your local water system. Currently, if a city wants a WIFIA loan, the project has to cost at least $5 million. That’s a huge barrier for smaller communities. Section 2 of this bill changes that, dropping the minimum eligible project cost for a “small community” (defined as 25,000 people or fewer) down to $1 million.

Think about a city manager in a town of 15,000 trying to replace aging pipes. Before, they couldn't even apply unless the whole project hit the $5 million mark. Now, they can access this low-cost federal financing for a much more manageable project. Crucially, the bill also authorizes the EPA Administrator to provide technical assistance—like help with engineering and financial planning—specifically to these small communities, recognizing that they often lack the staff to navigate complex federal applications.

Expanding the Guest List for Federal Loans

Section 3 expands the types of projects that can qualify for WIFIA financing. Previously, the list was somewhat restrictive, but now it includes projects like State-led water storage projects and certain water resources development projects owned by non-Federal entities. This means a state agency or a public utility working on a major reservoir expansion, for example, now has a new avenue for federal funding, potentially speeding up projects that manage regional water supply and drought risk.

Section 5 tackles the repayment timeline. For massive infrastructure projects—like new pipelines or treatment plants—that are expected to last more than 35 years, the bill extends the maximum loan maturity date. Instead of being constrained by the standard term, these loans can now be repaid up to 55 years after the project is substantially completed. This is a huge financial advantage, as it spreads the repayment burden over a much longer period, lowering the annual costs for the utility and, ultimately, for the customer.

Building It Better, Building It Faster

Section 4 is about bringing construction into the 21st century. It explicitly authorizes the use of “collaborative project delivery methods” for WIFIA-funded projects. This includes design-build and construction management at-risk (CMAR) methods. In plain language, this means instead of the traditional method where design is finalized before a contractor is hired (often leading to costly change orders), the project owner, designer, and contractor can work together from the start.

For anyone who has ever dealt with a construction delay, this is good news. Design-build means a single contract covers both the design and construction, which typically reduces project timelines and risk. The bill mandates a study within 180 days to figure out how to best implement these methods and educate agency staff, showing a commitment to making projects more efficient.

The Fine Print: Budget and Oversight

Beyond the project-level changes, the bill also reauthorizes funding for the Army Corps of Engineers' water infrastructure financing program through Fiscal Year 2029 (Section 6), ensuring that this separate financing track remains available.

Section 7 clarifies the budgetary treatment of these loans. Because WIFIA loans are repaid using non-Federal revenue sources (like your water bill), the bill specifies that they must be treated as non-Federal for budgetary purposes. This is an accounting measure designed to make the program financially viable within federal budget rules, but it does mean the federal government is guaranteeing loans that could last over half a century. While the loans are expected to be repaid, the taxpayer is the ultimate backstop if a project defaults.

Finally, Section 8 requires new reports from the EPA, the Army Corps, and the Government Accountability Office (GAO). This oversight is critical, especially given the new flexibilities and expanded scope of the program. The GAO report, for instance, must now evaluate the implementation by the Secretary of the Army, ensuring accountability across the board.